Washington, DC – Research conducted by the American Council of Trustees and Alumni (ACTA) and experts in college financing reveals that the top 25 liberal arts colleges in U.S. News & World Report spend on average twice as much on administrative expenses compared to Ivy League universities. The impact of increased administration on educational quality is dubious. This raises the question: Are students and parents paying for a better education, or for an inefficient bureaucracy?
The top 25 liberal arts colleges according to U.S. News & World Report (excluding the U.S. military academies, due to reporting issues) spend on average 45 cents on administration for every dollar they spend on instruction, and have a four-year graduation rate on average of 87%. Ivy League institutions, in contrast, spend on average 23 cents on administration for every dollar spent on instruction, with the same average graduation rate.
To cover their bloated administrative costs, these “Top 25” liberal arts institutions consistently raise tuition. Excluding Soka University of America, not a single school charges less than $50,000 a year.
“With a much smaller student body than the Ivies, these schools’ governing boards should be questioning why their institutions spend so much on administration,” said Armand Alacbay, ACTA’s vice president of trustee & government affairs. “The fact that the graduation rates remain the same between the two categories calls into doubt the assertion that more administrative support equates to higher graduation rates.”
The study draws on data from ACTA’s HowCollegesSpendMoney.com. Launched earlier this year, HowCollegesSpendMoney.com features unique analytic tools that enable college trustees and others to benchmark their institutions’ spending patterns against those of their peers.
HowCollegesSpendMoney.com is a trove of data that examines 1,500 of America’s four-year colleges and universities, and presents their financial data in a clear, easy-to-understand format. Former trustee of Wilson College, Stanley Stillman, asserted, “While all of these tools are flawed by the ‘accounting standards’ of the government database on which they depend, no resource matches the integrity, discipline, and utility of the one developed by ACTA.”
FOR IMMEDIATE RELEASE: August 13, 2019
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